Trendlyne Analysis

Indian indices closed sharply higher, with the volatility index, India VIX, falling significantly. Nifty 50 rose 288 points and closed above the 16,900 mark for the first time since May 5. European indices followed the global trend and traded higher than Wednesday’s levels. Major Asian indices closed higher, tracking the US indices, which closed in the green on Wednesday. US stocks rose after the US Federal Reserve raised the federal funds rate by an expected 75 bps to 2.5%. A 75 bps federal funds hike by the US Fed for two straight months is the steepest rise since the early 1980s. The tech-heavy index, NASDAQ 100, rose 4.3% while the Dow Jones closed 1.4% higher. However, NASDAQ futures traded lower as weak earnings by Meta led to a sharp fall in its share price after trading hours. Crude oil traded higher due to lower crude inventory and recovery in gasoline demand in the US.

Nifty Smallcap 100 and Nifty Midcap 100 closed in the green, following the benchmark index. Nifty Metal and Nifty Energy closed higher than Wednesday’s levels. Nifty IT closed in the green, tracking the NASDAQ 100, which rose 4.3% on Wednesday.

Nifty 50 closed at 16,929.60 (287.8, 1.7%) , BSE Sensex closed at 56,857.79 (1,041.5, 1.9%) while the broader Nifty 500 closed at 14,469.10 (206.6, 1.5%)

Market breadth is in the green. Of the 1,888 stocks traded today, 1,036 showed gains, and 804 showed losses.

• Solara Active Pharma Sciences, AstraZeneca Pharma India, Medplus Health Services, and Procter & Gamble Hygiene & Healthcare are trading with higher volumes as compared to Wednesday.

• The DEA and Revenue Secretary Tarun Bajaj says that the windfall tax will change with respect to the global crude prices. The Centre aims to maintain the fiscal deficit target of 6.4%.

  #StateOfTheEconomy | DEA and Revenue Secy Tarun Bajaj says
  
  - Aim to move #WindfallTax levy as per international crude prices
  - Aim to stick to 6.4% fiscal deficit target
  - Market & #rupee stable post the US Fed #ratehike@Meghnamittal23 @SecyDea @FinMinIndia #Taxes #Crude pic.twitter.com/wEIpuSllYY

  — ET NOW (@ETNOWlive) July 28, 2022

• PVR touches a 52-week high after its CEO Gautam Dutta says the company raised ticket prices by up to 23%, which helped it cross the Rs 1,000 crore revenue mark during Q1FY23.

• SBI Cards and Payment Services rises as its Q1FY23 net profit increases 105.8% YoY to Rs 626.9 crore. Rise in income from fees and commissions and fall in impairment costs help profit improve. The bank’s asset quality improves significantly with gross NPAs falling 167 bps YoY to 2.2% in Q1FY23.

• Stocks like Zomato, Gland Pharma, Tanla Platforms, and PB Fintech are in the oversold zone according to the technical indicator relative strength index or RSI.

• Sanofi India and GlaxoSmithKline Pharmaceuticals hit their 52-week lows of Rs 6,331 and Rs 1,399, respectively. Both stocks are falling for five consecutive sessions.

• Nestle India’s board of directors approve the purchase of Purina PetCare’s pet foods business for Rs 123.5 crore

• HDFC Securities maintains its ‘Buy’ rating on Aether Industries with a target price of Rs 1,045. This indicates an upside of 15.7%. The brokerage remains positive about the company’s prospects given its capacity-led expansion, advanced research & development capabilities, robust product pipeline, and loyal customer base. The brokerage estimates the company’s revenue to grow at a CAGR of 37.9% over FY22-24.

• Blue Dart Express’ Q1FY23 net profit rises 279.9% YoY to Rs 118.8 crore. Revenue rises 49.3% YoY to Rs 1,293.3 crore. Healthy top-line growth along with improved automation and digitization to increase speed, transparency and efficiency helps its EBITDA margin to rise 210 bps YoY to 21.1%.

• Reports suggest that the Centre may consider buyback of shares through defense public sector undertakings, which include Hindustan Aeronautics, Bharat Electronics, Bharat Dynamics, etc.

  #ETNOWExclusive | DIPAM is mulling buybacks in some of the defence PSUs. Sources tell ET NOW’s @meghnamittal23 that @HALHQBLR has been shortlisted for buyback and a final decision is expected soon @SecyDipam @finminindia #HAL #Midhani #BharatDynamics #CochinShipyard pic.twitter.com/DoLd0J4VkR

  — ET NOW (@ETNOWlive) July 28, 2022

• Shree Cements is falling as it reports a drop in net profit by 52% YoY to Rs 315.5 crore in Q1FY23. Profits shrink because an increase in raw material cost, depreciation cost and a surge in power and fuel costs by 2.2X YoY. Though revenue rises 22% YoY, the rise in costs saw EBITDA margin fall by 14 percentage points to 19%

• IFB Industries is trading with more than 28 times its weekly average trading volume. Zydus Wellness, Cholamandalam Financial Holdings, VIP Industries, and Metro Brands are trading at more than six times their weekly average trading volumes.

• Nestle India is rising despite its net profit declining as high commodity prices lead to an increase in input costs. Profit falls 4.3% YoY to Rs 515.3 crore. Revenue, on the other hand, rises 16.1% YoY on the back of growth in all its business verticals primarily driven by price hikes. The company’s domestic sales increase 16.4% YoY to drive overall sales volume growth. However, a rise in sales volume is offset by an increase in input costs causing the EBITDA margin to fall 290bps YoY to 20.3%.

• Metal stocks like Tata Steel, Jindal Steel & Power, JSW Steel, Welspun Corp, and Hindalco Industries, among others, are rising in trade. The broader sectoral index Nifty Metal is also trading in green.

• KEC International receives new orders worth Rs 1,233 crore across its various businesses. The orders include building a 765 kilovolt digital substation for Power Grid Corporation of India, supply of towers in West Asia and Americas, and laying a cross-country pipeline and associated works in India, among others.

• Dixon Technologies is falling as it reduces its revenue growth guidance after announcing its Q1FY23 results. It cuts its volume growth target for FY23 in the television segment to 3.6 million from 4 million on a slowdown in demand. It expects a fall in demand in other business verticals as well, thus lowering its revenue growth guidance to 7-10% for FY23. The company’s net profit rises 2.5X YoY to Rs 45.7 crore on a low base last year and revenue grows by 52.7% YoY led by a 4X rise in revenue from its electronic business.

  #OnCNBCTV18 | Expect cut in revenue target for FY23 due to slowdown in TV segment. Cooling commodity prices will lower freight costs & benefit EBITDA margin, says Atul Lall of Dixon Technologies pic.twitter.com/A51ujWDGs0

  — CNBC-TV18 (@CNBCTV18Live) July 28, 2022

• All IT stocks are trading in the green. Stocks like Infosys, Larsen & Toubro Infotech, MindTree and L&T Technology Services are up by more than 2%. The broader sectoral index Nifty IT is also rising in trade.

• Havells is rising despite a fire at its factory at Neemrana, Rajasthan on Wednesday. The company reports that there is no loss of human life and is currently assessing the cause of the fire.

• SpiceJet is falling as the Directorate General of Civil Aviation (DGCA) restricts the company's flights to 50% for the next eight weeks, according to reports. The restriction comes after considering the findings of various spot checks, inspections and SpiceJet’s reply to the show cause notice issued on July 5.

  #CNBCTV18Market | SpiceJet down nearly 7% after DGCA restricts airlines flights to 50% of departures approved under the summer schedule pic.twitter.com/vOp6eNMPf4

  — CNBC-TV18 (@CNBCTV18Live) July 28, 2022

• Biocon is falling in trade despite its Q1 net profit rising 71.1% YoY to Rs 144.4 crore. The rise in profit is driven by new product launches in generics and biosimilar segments. Revenue rises 21.5%YoY to Rs 2,139.5 crore on the back of the generics and biosimilars segments rising 19% YoY and 29% YoY, respectively. Amid supply chain constraints leading to higher input costs and employee benefit expenses, the company’s EBITDA margin rises 100 bps YoY to 31%.

• Hindustan Aeronautics is rising after it inks a pact with Honeywell worth $100 million. The contract is for the supply and manufacture of engines and kits, along with maintenance of Hindustan Trainer Aircraft (HTT-40) engines for the Indian Air Force.

• Tata Motors’ Q1FY23 net loss widens to Rs 5,006.6 crore because of the ongoing semi-conductor shortage and a surge in raw material cost by 25.8% YoY. This increase in expenses led to a fall in operating margin by 312 bps YoY (to 4.2%), despite an 8.7% increase in revenue. A rise in passenger vehicle sales in the India business helped revenues increase while subsidiary Jaguar Land Rover's (JLR) revenue is down. Lockdowns in China and slow sales of new products hurt JLR's performance during the quarter.

Riding High:

Largecap and midcap gainers today include Bajaj Finance Ltd. (7,076.60, 10.63%), Bajaj Finserv Ltd. (14,642.05, 10.03%) and JSW Energy Ltd. (242.80, 6.61%).

Downers:

Largecap and midcap losers today include Biocon Ltd. (306.75, -5.12%), GlaxoSmithKline Pharmaceuticals Ltd. (1,399.20, -3.60%) and Dixon Technologies (India) Ltd. (3,578.50, -3.29%).

Movers and Shakers

38 stocks in BSE 500 are trading on high volumes today.

Top high volume gainers on BSE included Indiabulls Housing Finance Ltd. (114.75, 11.68%), Bajaj Finance Ltd. (7,076.60, 10.63%) and IFB Industries Ltd. (1,001.15, 10.61%).

Top high volume losers on BSE were VIP Industries Ltd. (608.60, -6.30%), Mahindra Lifespace Developers Ltd. (407.45, -5.66%) and Biocon Ltd. (306.75, -5.12%).

Metro Brands Ltd. (636.90, 9.56%) was trading at 20.6 times of weekly average. Responsive Industries Ltd. (142.60, 4.62%) and Zydus Wellness Ltd. (1,653.35, 3.04%) were trading with volumes 10.4 and 10.3 times weekly average respectively on BSE at the time of posting this article.

BSE 500: highs, lows and moving averages

12 stocks made 52 week highs, while 5 stocks were underachievers and hit their 52 week lows.

Stocks touching their year highs included - Bharat Electronics Ltd. (272.35, -0.29%), Coromandel International Ltd. (1,058.90, -0.53%) and Inox Leisure Ltd. (572.65, 1.25%).

Stocks making new 52 weeks lows included - GlaxoSmithKline Pharmaceuticals Ltd. (1,399.20, -3.60%) and Sanofi India Ltd. (6,339.80, -0.31%).

35 stocks climbed above their 200 day SMA including Bajaj Finance Ltd. (7,076.60, 10.63%) and Bajaj Holdings & Investment Ltd. (5,187.50, 6.04%). 9 stocks slipped below their 200 SMA including VIP Industries Ltd. (608.60, -6.30%) and Torrent Power Ltd. (502.85, -1.42%).